Tolvaptan is a member of a new class of drugs, called the vaptans, that antagonize receptors of the neurohormone arginine vasopressin. From a clinical perspective, tolvaptan has been shown to be efficacious in the treatment of hyponatremia, whether it is idiopathic or disease related, and it may have a more favorable benefit/risk profile than other treatment modalities. From an economic perspective, tolvaptan is an expensive drug for treating hyponatremia, but recent economic cost-offset models provide evidence that tolvaptan can be cost effective. The cost-effectiveness of tolvaptan is driven by reduced healthcare resource usage and hospitalization costs. More comparative research of tolvaptan versus other pharmacotherapies and analyses of patients treated with tolvaptan in the real world are needed to better determine the benefits of tolvaptan usage to patient outcome, and more accurately assess its value in the treatment of hyponatremia, an independent predictor of morbidity, mortality and cost.